190901 digital priorities 1
Image Credit: José Luis Barros/©Gulf News

A few months ago, something almost unprecedented happened in the world of advertising. While it went largely unnoticed, Edelman, a legacy public relations firm, was named to the prestigious 2019 Ad Age A-List.

The list, as the name suggests, is usually reserved for traditional advertising shops and this year’s list saw Edelman listed alongside the who’s who of the industry such as TBWA, McCann, FCB and Wieden & Kennedy, to name a few. This was quite a feat for a non-advertising outfit. In another major stroke just a few weeks later, Edelman managed to lure creative veteran Judy John away from Leo Burnett Canada — another storied advertising powerhouse — as its first Chief Creative Officer.

These developments are a microcosm of a wider shift currently underway in the advertising and communications industry, apart from being a prime example of how the world’s largest public relations firm has successfully redefined its business to meet the needs of the digital age and a new breed of client. In recent years, Edelman has sharpened its efforts towards integrated creative campaigns, augmenting its ranks with creative professionals of all stripes.

A large chunk of the agency’s revenue is now driven by digital, data intelligence and analytics — all of which help to inform creative direction and the kind of work that their clients need.

Playing catch up

On the other hand, in stark contrast, WPP agencies have proven to be less than adept in evolving according to the market landscape, with a raft of internal consolidation and mergers dominating headlines over the past one year alone. Under the slogan of “radical evolution”, in the words of CEO Mark Read, the holding company is attempting a turnaround in order to return to growth.

But it seems more a knee-jerk reaction to prevailing market conditions rather than foresight. In its three-year growth strategy, revealed in December last, streamlining and strategic integration were constantly reiterated.

The company also specifically mentioned its emphasis on improving its technology and data capabilities. The resulting integration of digital shop VML with Young & Rubicam, data analytics and digital agency Wunderman with traditional powerhouse J. Walter Thompson, as well as Burson Marsteller with Cohn & Wolfe, clearly demonstrate the company’s long-term direction.

Now let’s face it, things haven’t been rosy for agencies and holding companies lately. Google and Facebook have changed the face of digital advertising and continue to devour the lion’s share of associated budgets. Consultancies are slowly, and aggressively, nudging their way into the turf once dominated by holding companies.

Take Accenture’s takeover of Droga5 and Insitum as just one example. At the same time, marketing budgets are being consolidated and CMOs want integrated offerings at optimised costs, seeking 360-degree, holistic creative shops that provide all the services they require under one roof.

Digital above all else

Now more than ever, the onus is on traditional agencies to offer digital-first services and revisit their business models in a way that puts the client front and centre. WPP’s falling revenues and ongoing consolidation are testament to this.

The reality of the world we live in now is this: data is the fuel and digital platforms are the engine that power brand messaging and the modern consumer experience. Those who can successfully harness the possibilities afforded by a digital-centric approach will thrive.

Failure to do so does not simply entail the risk of smaller disrupters getting ahead. It can also open up an established agency to a new threat — in-housing by brands. FMCG giant Procter & Gamble is perhaps the best example of this.

In an effort to be closer to its customers and speak directly to them, the company has made sweeping marketing cuts year after year — with several agencies being culled in the process — but also succeeded in being recognised for its creative prowess, in spite of the cuts. The company has a slew of more reductions in the pipeline and doesn’t plan to halt the process of streamlining anytime soon.

The writing on the wall is clear. It’s Darwinism at its simplest — survival of the fittest. Evolve or die. Agencies that adapt and bring about the fundamental change necessary to succeed in a new — and uncertain — digital era will succeed.

With newer innovations such as 5G, the internet of Things, Artificial Intelligence and Smart Cities on the horizon, data is set to be created at an accelerated rate and will emerge as the currency of the future. “Tried and tested” doesn’t hold water in the modern consumer market.

Those who continue to stick to old business models are at risk of going the way of Blockbuster or RadioShack.

Adnan Bashir is Senior Manager for Corporate Communications at Sigma Systems.